February 10, 2011
IGNORED! Yen traders didn’t seem to pay any mind to the couple of green figures that Japan released early in the day. In spite of positive economic data, USD/JPY finished hardly unchanged at 82.37.
Household confidence surprisingly picked up strongly last month, as the index doubled the expected increase and rose from 40.1 to 41.1. Keep in mind, the last time Japan recorded a rise in confidence was back in June 2010.
We also learned that machine tool orders picked up 89.4% year-on-year last month, up from 64.0% in December. Hmm… Not a bad way to start the year, don’t you think? If this keeps up, talks of additional stimulus may soon vanish.
Unfortunately, the string of good news came to an end a couple hours ago. Japan posted a disappointing core machinery orders figure. Machinery orders rose 1.7% in December, which is only a third of the growth that was forecasted. Still, this news isn’t entirely bad. It still marks the first increase in four months, and we’re also seeing signs of improving corporate earnings and business investment. There is hope!
The rest of the day will be quiet in Japan. In the meantime, monitor risk sentiment and any developments in the U.S. as they may determine USD/JPY’s destination for today. Good luck!
"The only cable I watch is the pound baby."